After The IPO, LPL Is Still LPL

If you work for LPL Financial, the nation's largest independent brokerage firm which just went public in November, you cannot talk the company's daily stock price. If you do, CEO Mark Casady will fine you $5. He's already collected-well, $5.

After taking the firm public in November, LPL's CEO says it's business as usual. LPL reports 4Q earnings on February 7.

That's what Casaday told me today when I asked him if he's fervently checking his firm's share price now that LPL is public. "Quite the opposite. We ask that employees don't talk about the stock price," he says. Why? "Share price is an outcome of how we perform as a company. If we focus on what we've always focused on-serving our customers-then the share price will hopefully speak for itself," he explains.

The shares were priced at $30 on the IPO date of November 18--the same day as GM's IPO mind you--and started trading at about $32. LPL shares are up 13% from the offering price and about 6% from the opening price of $32. The IPO was the largest financial public offering in 2010 raising more than $470 million.

In 2005, two private equity firms TPG Capital and Hellman & Friedman bought 60% of the firm valuing the company at $2.5 billion. I wrote about LPL in Forbes right before it announced the IPO date. At that point the executives were in a quiet period because the firm had filed an S-1 with the SEC establishing its intention to go public.

When the date was revealed there was speculation about whether sharing an IPO date with GM, which was raising an impressive $20 billion, was a good or bad idea. "I think we helped them by sharing the date," CFO Robert Moore says with a smile. "They were lucky to be able to share it with us."

Casady recalls traveling around the country for the IPO roadshow and running into the GM team which was doing the same thing. "You knew who was GM and who LPL because they were about 25 people and we walked in with maybe 2 people," Casady jokes.

There's no doubt about LPL's relative small size compared with GM but that didn't keep it from scoring the top investment bankers to underwrite its IPO. Goldman Sachs , Morgan Stanley, BofA Merrill Lynch and JP Morgan Chase were joint lead managers and 8 other investment banks were co-managers. The banks exercised their option to purchase an additional 1.57 million shares- a sign of a successful IPO.